HAPPY NEW YEAR!
The new year brings a change of blog address and a rebranded blog site for Bright Business Thoughts.
For your information if you have come from my website link the new address is:
www.brightbusinessthoughts.co.uk
Welcome!
I look forward to reading your comments and I hope you like the new look.
Fiona 
Christmas comes but once a year and can be a time of mixed emotions. We use this time of year as an opportunity for reflection and hopeful anticipation for the new year. So what of 2011?
This year seems to have been a strange mix of contradictions. The economic downturn seems to go on without any let up; but for several businesses I know 2011 has been their best year ever! Most retailers rely on the Christmas surge in consumer spending to fund the rest of the year; but this year has seen huge pre-Christmas sales – what will this mean for the high street in 2012? The government is keen to see investment in small businesses; but uses the banks, who are busy propping up their own balance sheets, as the vehicles to supply this funding. Consequently, many good businesses are finding funding a struggle. In short there is a lot of uncertainty which is likely to remain through out 2012.
So what does that mean for business owners.
Firstly, I think that it is more important than ever to have a proper plan for the year ahead so that you, the business owner, are able to reduce the risks to your business. The strongest businesses rely as little as possible on banks for funding by keeping on top of their debtors and planning expenditure. They have clear objectives and know what they need to achieve to meet their stake holders’ individual goals. Their owners know what their own particular weaknesses are and seek help to mitigate them.
Secondly, I think it is easy to become overly gloomy. There are opportunities out there and small businesses are often more able to take advantage of them than larger ones. This is because small businesses are much more flexible and can take decisions quickly without the burden of cumbersome management structures. So, if your business is doing well don’t listen to the doommongers – be confident in the future and carry on doing what works for you.
Many business owners have a support network, but they don’t necessarily recognise it’s value. We are continually looking to make new contacts without properly getting to know existing ones. By having a strong, trusting, connection with key strategic partners, we can build a solid foundation of support for us and our businesses. A reciprocated support network can make all the difference to a small business surviving or not.
As regular readers will know I run the Billy No Mates Christmas lunch. This year’s bash was the best ever with over 30 people signing up (although a couple were ill on the day). It was a super opportunity for micro business owners to tap into the local support network in a fun way and realise they are not completely on their own. A note for your diaries – the 2012 bash is on 21st December.
Have a wonderful Christmas and a very successful 2012.
Fiona
It has been a little while since I blogged and part of this has been because it is the silly season and I have been very busy. Part is because I have struggled for a theme to write about – so I have decided to go back to an old friend.
As regular readers of the blog know I am passionate about business planning. I am constantly amazed how little business planning seems to go on, but how the energy released once a business embraces proper, strategic planning can lead to really powerful results.
I am currently running a 2 day business planning workshop for the Soil Association. Some of the group have done planning before – others haven’t. However, by the end of the workshop everyone is engaged and contributing to the exercises. The reason for this is that they are all passionate about their organisation and want to achieve the best they can. They have different areas of expertise which are all critical to the associations’ success, and are able to bring this to the planning process.
At the end of the two days each of the three groups have made good inroads into producing a business plan for a real project. More importantly they have a clear idea of the extra information they need to get hold of if they are going to complete meaningful plans to be presented to a third party – be it a director or an outside agency. There is also a great energy which will see the business plans moved forward.
You can achieve the same in your business by taking time out of your day-to-day work to really review your business and where it is going. If you involve other employees/managers in your review and planning exercise, you may well find that ideas and energy flow in a way that you have not seen before.
However, if your business is not worth this time out, I would suggest you review why you are in the business you are in.
As always I would extol you to work smarter and not harder – and part of this is having a robust plan.
It’s funny that one of the side effects of a recession is often that more new businesses are created than in good economic times.
There are several reasons for this:
Firstly, people who are made redundant may use their redundancy money, and newly found free time, to launch a business idea they had been thinking of for a while. Whilst they were in employment they did not want to take the risk of leaving their safe job to go into the more risky world of self employment. But once the safety net was gone they were prepared to give their new idea a go.
Secondly, as they say ‘necessity is the mother of invention’. People can become more creative. In a world of constant change and instability entrepreneurs can take advantage of others’ indecision to take advantage of opportunities.
Also, people who have been out of the job market for a while and need more flexibility than traditional employment can offer, look to start their own business to enable them to have the flexibility they need. Examples of this are parents returning to work after looking after their young children, or other carers. When the economy is buoyant and jobs plentiful it is easier to find flexible employment opportunities – these opportunities often fall by the wayside when times are hard.
However, just because there are more businesses starting out does not mean that they will be successful. In my experience there are several reasons why a business will succeed:
1. The business owner has properly investigated their chosen market and taken the time to understand what their customers are looking for. They have a properly thought through business plan investigating all areas pertinent to their business.
2. The business owner gets proper professional advice in areas they are not expert in. This means they do not make the wrong decisions through lack of knowledge/skill.
3. The business is properly funded. In the days when banks are very reluctant to lend money it is foolish to start a new business unless the money is available to do it! Using own funds first is the cheapest and safest way of starting a business. If bank funding is needed it is important to make sure it secure is before spending starts!
4. The business owner is passionate about their business. There are much easier ways to earn a living than running a business and it is passion and drive which will ensure momentum is maintained in the early days. If a business owner is not passionate about their business proposition it is very difficult to keep up the energy required to see it properly established. Also it is much more difficult to get any one else interested.
Running your own business is by no means an easy option but it can be completely liberating.
Fiona
You don’t need me to tell you that times are hard.
Increasingly companies who thought they had weathered the worst of the recession, are finding that they are struggling to carry on any further.
In some cases their customers are struggling, or have gone bust themselves; in others their banks are refusing to play ball and are withdrawing their overdraft facility.
If you are thinking the worst with your business it is very important that you don’t the following:
1. Stick your head in the sand! Ignoring the problem is not going to make it go away. If you don’t take control of the situation it may well end up taking control of you!
2. Do anything rash! As bad as ignoring the problem is taking rash action can be worse. I have seen business owners take on high interest debt to save a company which is beyond saving. This has left them personally exposed and, sometimes, bankrupt as a result.
3. Keep your staff in the dark! In my opinion is morally right to keep your staff informed of the business situation, and is also sensible from a business view point too. Firstly, you may think that staff do not know the business is in trouble, but in my experience your very behaviour is likely to alert them – certainly irate calls from creditors will. It is better for them to hear the truth from you than to imagine a worse truth themselves. Secondly, if you keep them informed, and hopefully on your side, you are more likely to hold onto them than if they feel, perhaps erroneously, that there is no future and leave anyway.
DO SEEK PROFESSIONAL HELP AT THE EARLIEST OPPORTUNITY!
If you don’t know the exact financial position it is important to find out what it is from your accountant. You will need to look at both your business and personal finances together as they are inextricably linked.
If you suspect the situation is bad talk to a debt specialist – they will be able to review: where you are; what your options are; and the order in which action should be taken. Chris and John from Lightside Financial, for example, are fantastic at getting to the nub of what needs to be done.
Finally, do what your professional advisors advise! It may be unpalatable medicine or even terminal from your business’s view point, but it will almost certainly enable you personally to come out of a terrible situation as painlessly as possible.
Fiona
I am a great believer that as business owners we have to give ourselves a break every so often.
We often do not celebrate when we have done particularly well, or when we have come out the other side of a particularly gruesome time.
In traditional businesses the office party has become their opportunity to do just that. The business owners provide the environment for employees to kick back and enjoy each others company in a fun way.
Of course the staple office party comes at Christmas.
But if you work on your own you don’t have anyone to party with. Five years ago I tried to address this by starting the Billy No Mates Christmas Bash in Wells, Somerset. The idea is that business owners who work on their own, or with just one employee, can come along to a Christmas party. It is NOT a networking event but just an opportunity for some ‘letting down of hair’.
Each year this event has become more and more popular – little wonder when there are so many one/two man (and women) businesses in the country.
So why don’t you come along? If you don’t live in Somerset why not start your own Billy No Mates where you are?
For more information please visit www.fionabevanfinancialmanagement.co.uk and click on Billy No Mates Christmas 2011.
Fiona
I have been working with several clients recently reviewing their business plans and working on various ‘what if’ scenarios. This has got me thinking about what motivates business owners and impacts on their decision making.
Over the years I have had clients who have expressed goals for their business, which it turns out were not their goals at all, but goals they believed they should have.
One particular example was a very focused, dynamic and forward looking client who was (and still is) a super businesses person. Their business was becoming successful and they had some surplus cash to spend.
During one of our regular reviews they expressed the wish to get a new car. Now I already knew they also had plans to expand their business and to buy a new house. Given there was only the money available to do one of these things, I asked which was the most important to them to do.
They immediately said expanding their business was paramount – which, incidentally, I knew they would say.
They have since gone on to do just that!!
It turned out that the reason they wanted a new car was, not because it was particularly important to them, but because they had picked up along the way that successful business people have new cars.
The lesson of this story is to look hard at what motivates YOU. What does success look like to YOU?
After all it is YOUR business and should be delivering against your idea of success not someone else’s. That is why we start businesses in the first place rather than carrying on in employment where we are working to achieve someone else’s dreams.
Fiona
For many companies the recession continues and times are definitely hard. A natural, and quite correct, response is to batten down the hatches. This means reviewing every penny spent and making sure that money is only spent on essentials.
Now is definitely the time to make sure the procedures are in place to ensure proper expenditure controls are followed. There has never been a time for most businesses when ‘cutting their cloth’ to suit their means is more apt.
Reviewing unavoidable costs such as rent, rates, utilities etc can also be rewarding. For example, if your rental lease is up for renewal it is very likely that you can negotiate a reduction. If your landlord won’t negotiate there are many empty offices and commercial premises empty. It may well be cheaper to move, than to carry on paying the higher rent – you may even be able to get a rent free period.
However, it is important not to throw the baby out with the bathwater!
For many businesses one of the keys to their success is their employees. Keeping your employees trained, and your processes efficient, can make the difference between taking advantage of opportunities as we move towards growth in the economy, and not.
A couple of my clients are taking the view that they can help their employees work more efficiently by reviewing their systems – both computer and manual. Both companies are growing, so by freeing up the time of existing staff they are able to function without taking on anyone new. A no-brainer in my opinion.
Similarly, service companies in particular, need to ensure that they continue to train their employees so they are up to date in their relevant fields. This will ensure that they work as effectively as possible, whilst offering clients the most relevant service to them.
This enables them to remain competitive and even to edge in front of competitors who are not keeping up.
Fiona
Well it’s back into the groove after the kids summer holidays and raring to go after a couple of rain free camping trips (unheard of in our family) and a week in Cornwall.
I am always amazed at how motivated and ready for work I am after a break. It is easy to get bogged down in the day to day aspects of business and working long hours makes it gradually more difficult to see the wood for the trees. A break from the work routine helps to de-fog and re-calibrate the brain.
Although I try to have a ‘proper’ break with my email switched off, I am sure my brain is still working in the background mulling over issues and putting problems to bed. This type of ‘unconscious’ thought also occurs when we are doing physical exercise. How many times have you been wrestling with a problem in the office only to have the solution pop into your head when you take a break away from your desk?
In this country there is still a culture of presenteeism, which business owners find as difficult to break away from as employees. I have had clients complain that although they work long hours (often outside the office) colleagues make snide comments when they leave early or take a day off. We need to break away from this type of thinking because it is not productive.
As business owners we have to think about many different aspects – this thinking is not necessarily best done in a crowded office (or even in an office at all). We need to work in a way which produces the best results for us and be creative in allowing ourselves to do this. If a day out of the office spending time on a hobby allows you to be more effective once you are back at work, it makes sense to take that day.
After all, as I said in my previous blog, we started our own businesses because we wanted to have more control over our work lives. We need to be strong in that conviction and not allow ourselves to be forced into ‘corporate’ work practices because we feel obliged by others’ thinking to do so.
Fiona
Well it’s is that time of year when the kids are on holidays and business owners up and down the country are trying to juggle family and work commitments.
This is particularly so if you work on your own and don’t have staff to cover whilst you are away. If you are a service provider it an be difficult to ensure that clients don’t become unhappy about breaks in that service.
Small business owners often find themselves taking work away with them, constantly available on their mobiles or smart phones, with their laptops continually at their side. Consequently, they don’t get the break they need and their families find themselves a poor second to business demands – even though it is supposed to be a family holiday.
I have found that, over the years, there are ways to work around the problem as long as you plan.
Firstly, it’s worth remembering that most clients understand that you need a holiday and want to spend time with your family. Many customers will be going on holiday themselves and it is generally the case that many businesses don’t make important decisions during the holiday season.
Secondly, it is important that you keep your customers in the picture so that they know exactly when you will be available and when not. As long as they have plenty of notice before you go on holiday, they can tell you of any work they need to be done before you go, so it can be completed on time.
Thirdly, make sure that you change your answering machine message on your mobile, and use your out of office wizard on your email (if you have it), so any customers who have forgotten you are away get an appropriate message. This way they at least know that you are not ignoring them. Even better engage the services of a company such as the Call Clinic run by Jayne Gooch to cover your phones whilst you are gone.
Make sure you have completed all ongoing work as far as possible so you are not worrying about it during your time off. There is nothing worse than going away with a pile of work calling at you ensuring you cannot relax.
Finally, remember this. Everyone needs a break and you will work much more effectively when you get back if you have had a PROPER rest. Also remember the reason you became self employed in the first place. It was probably to get a better work/life balance and to ensure you had more family time!
Fiona
